NIFTY 50'S FASTEST-GROWING COMPANIES!

Whenever investors browse stocks to add to their portfolios, they need crystal-clear quantitative parameters to filter out stocks that support their thesis. For example, EPS growth is one of my favorites when it comes to filtering out stocks that show consistent earnings growth within the company.EPS is simply a company's net income divided by the shares outstanding to give the earnings number for each share. Earnings per share growth is generally one of the most important metrics shareholders look to to measure the company's financial performance as it is the net figure to which shareholders are entitled after all expenses and accounting adjustments. Listed below are 3 companies from the leading Nifty 50 index that have posted the highest EPS growth over the past 5 years.

SBI- First on the list is State Bank of India which has a market capitalization of INR 5,17,314 crores making it the largest public bank in the country. Following the Covid-19 pandemic, the bank has shown an exceptional recovery in the share price, which has risen from a May 2020 low of INR 149.45 to an all-time high of INR 586.2 a few days ago. The massive rebound in share price was driven by strong financials as they posted their highest ever turnover of INR 4,06,973 in FY22, consequently resulting in a 57.88% yoy increase in net profit to 35,373 crores. This equates to EPS of INR 39.64, which was just INR 0.31 in FY 2017. This is a massive 5-year CAGR of 164%. No other company in the index even comes close.

HINDALCO- Hindalco Industries Ltd is the second fastest growing company in the Nifty 50 list in terms of the above parameter. This miner has a market cap of INR 92,343 crores and is trading at a P/E of just 6.73 compared to the industry average of 13.34.The company posted a record profit of INR 13,730 crores in FY22, which is a staggering 294% higher than last year's profit of INR 3,483 crores, and EPS, which was INR 8.89 in FY2017, rose in FY22 61.74 INR representing a 5 year CAGR of 47.36%. FIIs hold a significant 24.76% stake in the company, while mutual funds also own 13.15%. As I always mention, investors need to be particularly vigilant in commodity-based companies due to their cyclical nature.

JSW STEEL - JSW Steel Ltd (NS:JSTL) is engaged in the production and distribution of iron and steel products and has a market capitalization of INR 1,63,281 crores. The company also saw a massive profit jump of 161.22% to INR20,665 on higher commodity prices in FY22. In the last 5 years, the market share has also increased from 15.41% to 19.85%.The increased profit pushed EPS up to INR68.51 in FY22, down from just INR11.7 in FY2017, a 5-year CAGR of 42.4%. The icing on the cake is that the company also trades with a dividend yield of just over 3.21%.

These 3 companies mentioned above are the only ones in the Nifty 50 index that have clocked a 5-year CAGR in EPS of over 40% and all 3 of them posted the highest-ever earnings in FY22.

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